Your Risk Tolerance In The Market

Matching investor EXPECTATIONS with Reality!

The key innovation of Riskalyze is based on the work of the 2002 Nobel Prize in Economics winning behavioral psychologist Daniel Kahneman, whose “Prospect Theory”** showed that people often do not make decisions solely to maximize economic utility. People in thought experiments will often give up a free benefit in order to deny others from getting a greater benefit if it seems unfair. Many hate losing more than they like winning. We’re complicated, emotional creatures, especially when it comes to money.

Aaron Klein (company co-founder) says that risk tolerance is often misunderstood. “It’s not how scared of risk an investor is,” he observes. “It’s how far one’s portfolio falls before they capitulate. This kind of decision making often causes people to sell low and sit out the recovery.”

Historically, investors’ risk tolerance was determined mostly through age-based stereotypes, gut instinct and surprisingly subjective questions such as “Do you get a thrill out of investing?” and “If your investment were a car, what kind it would be?” Klein and his team set out to develop a more quantifiable assessment using questions such as “Suppose you had $100,000 to invest. Would you prefer an assured gain of $10k or risk losing $30k for the chance to gain $50k?” Those surveys, along with beefed-up analysis tools for assessing an investment’s actual risk, were baked into a software platform that indexes both investor risk tolerance and investment product riskiness on a “one to a hundred” scale. Using this tool, advisors are frequently surprised at how misaligned peoples’ portfolios are with their appetites for risk.

Would you like to know the facts about the TRUE level of risk you have in your portfolios?

Would that be a better measure of your future retirement income risk than someone’s opinion?

Would you sleep better knowing this important piece of your retirement planning was not left to chance?

If you answered “Yes” to any of the above questions then commit to your next step.

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Investment advisory services offered through Horter Investment Management, LLC, a SEC-Registered Investment Advisor. Horter Investment Management does not provide legal or tax advice. Investment Advisor Representatives of Horter Investment Management may only conduct business with residents of the states and jurisdictions in which they are properly registered or exempt from registration requirements. Spenser T. Vago is an Investment Advisor Representative of Horter Investment Management, LLC. Insurance and annuity products are sold separately through Spenser T. Vago and Vago Insurance Agency LLC. Securities transactions for Horter Investment Management clients are placed through Trust Company of America, TD Ameritrade and Jefferson National Life Insurance Company.

Your investment advisor may recommend third-party money managers who utilize investment strategies designed to minimize portfolio volatility and reduce the risk of declines in account values. Like any other investment strategy, this approach entails risks, including the risk that client accounts can still lose value and the risk that a defensive position may, at any given point in time, prevent client accounts from appreciating in value.

Insurance and annuity products are not sold through Horter Investment Management, LLC (“Horter”). Horter does not endorse any annuity or insurance products nor does it guarantee their performance. Owners of these products are subject to the terms and conditions of the policies and contracts of the issuing companies. All product guarantees depend on the insurance company’s financial strength and claims-paying ability.